Security Deposit

Also found in: Dictionary, Thesaurus, Medical, Financial, Acronyms, Encyclopedia, Wikipedia.

Security Deposit

Money aside from the payment of rent that a landlord requires a tenant to pay to be kept separately in a fund for use should the tenant cause damage to the premises or otherwise violate terms of the lease.

A security deposit is usually in the amount of one or two months' rent. It usually must be paid at the time that the Landlord and Tenant sign the lease. The landlord must place the funds in an escrow account and give the tenant any interest generated by such funds. Upon the termination of the lease, the landlord must return the security deposit to the tenant if no violations of the lease occurred. He or she may keep the security deposit or portion thereof for the amount of any damages, which can be proven, pursuant to the terms of the lease.


Landlord and Tenant.

West's Encyclopedia of American Law, edition 2. Copyright 2008 The Gale Group, Inc. All rights reserved.

security deposit

n. a payment required by a landlord from a tenant to cover the expenses of any repairs of damages to the premises greater than normal "wear and tear." The security deposit must be returned within a short time (varying by states) after the tenant vacates, less the cost of repairing any unusual damage. Unfortunately for tenants these damages are usually subject to the judgment of the landlord, who may desire to paint and refinish on the tenant's money, and is thus, resulting in many small claims suits. In a few states the security deposit must be kept in a separate bank account, and some states require payment of interest on the amount held as a deposit. A security deposit is sometimes confused with a deposit of the "last month's rent," which may be credited to the tenant for the final month's rent. A security deposit cannot be used legally as a rent credit. (See: landlord and tenant, rent, lease)

Copyright © 1981-2005 by Gerald N. Hill and Kathleen T. Hill. All Right reserved.
References in periodicals archive ?
After a year of on-time payments, you can upgrade to an unsecured credit card that doesn't require a security deposit and offers better rewards.
"I think for the most part everybody expects they'll be paying a security deposit," said Melissa Noblit, CEO of Mirador Real Estate.
"On security deposits, for the existing that have been posted in favor of PEMC, we're thinking of letting them remain until expiration - subject to agreement with PEMC and the banks," he said.
The landlord may obtain from the tenant a security deposit to ensure maintenance of the real property, provided that the landlord undertakes to refund such deposit or remainder thereof to the tenant upon the expiry of the lease contract.
When Gulf News called Dewa's Customer Service, an agent said Dewa does study the usage of tenants and may require an additional security deposit if the average monthly usage exceeds the security deposit.
If you ever have a dispute with your landlord over security deposit deductions, the evidence and reports will be helpful.
5 States with Lowest Security Deposits for Conditionally Approved Apartment Residents OK $411 MI $411 NM $391 IA $386 AK $341 5 States with Highest Security Deposits for Conditionally Approved Apartment Residents NJ $1,280 CT $1,364 NY $1,645 MA $1,719 CA $1,891 Source: Neighborhood Pay Services Note: Table made from bar graph.
The duplex's owner, Shirley Burke, said she had to ask renters to pay the security deposit again, because without the deposits, it's "extremely hard" to find another property manager.
The proper upkeep of security deposits is one of the most misunderstood areas of real estate license law.
After the write-off, their security deposits invested in form of NSC, KVP and POTD were returned to them but they received only the maturity amount on these instruments which had matured much earlier.
At least one lower court in Santa Clara County entered summary judgment in favor of tenant's assignee for the full amount of the unused portion of the security deposit. In Sherwood Partners, Inc., a California corporation, as Assignee for the Benefit of Creditors of Spinway, Inc.

Full browser ?